While the disparity between XP IIS 5.1 and 2003 IIS 6.0 is not great, we
currently use Windows 2003 on all of our development machines. It makes it
easier to test a deployment, realizing, of course, that deploying to a
machine that is used for development is still not exactly the same as
deploying to a server.

I have no real feelings either way, as you should have a test environment
that mirrors production and you will NEVER reach the exact same specs on a
dev machine. I have worked on both Windows 2003 and XP and do not see a
reason to justify the cost of moving to 2003, at least not in any instances I
have been in.